The interferon inducible protein 16 (IFI16) is a prominent sensor of nuclear pathogenic DNA, initiating innate immune signaling and suppressing viral transcription. However, little is known about mechanisms that initiate IFI16 antiviral functions or its regulation within the host DNA-filled nucleus. Here, we provide in vitro and in vivo evidence to establish that IFI16 undergoes liquid-liquid phase separation (LLPS) nucleated by DNA. IFI16 binding to viral DNA initiates LLPS and induction of cytokines during herpes simplex virus type 1 (HSV-1) infection. Multiple phosphorylation sites within an intrinsically disordered region (IDR) function combinatorially to activate IFI16 LLPS, facilitating filamentation. Regulated by CDK2 and GSK3β, IDR phosphorylation provides a toggle between active and inactive IFI16 and the decoupling of IFI16-mediated cytokine expression from repression of viral transcription. These findings show how IFI16 switch-like phase transitions are achieved with temporal resolution for immune signaling and, more broadly, the multi-layered regulation of nuclear DNA sensors.